TIME Managing Editor Rick Stengel once again is shuffling the deck among the magazine’s top brass now that Priscilla Painton, one of his three deputy editors, has opted out.

Painton was the highest-ranking woman ever in the history of Time magazine. And she said the decision to step away – which was announced to staffers yesterday in an internal memo from Stengel – was a voluntary one. She’ll leave by the end of the year.

“I went to Rick months ago and said I wanted to reinvent myself,” said Painton, who is 49 years old and has been at Time magazine for just under 20 years. “Since he had done exactly the same thing, he was very supportive.”

Stengel had left Time to become the CEO of the Constitution Center in Philadelphia before Time Inc. Editor-in-Chief John Huey recruited him back to the top spot last spring.

Painton said she is going to travel to Italy, where she was born, and then to Paris, where she spent much of her youth. Her father, Frederick Painton, was one of the founding editors of Time Europe.

Stengel replaced Jim Kelly in May 2006 after Time Inc. launched a fairly public search mainly outside the company. Because Stengel had been away from the magazine for several years, he opted to keep the magazine’s upper echelon.

However, Steve Koepp, the longtime deputy managing editor under Kelly, immediately decamped for a new gig at the Time Inc.-owned Fortune, clearing the deck for Stengel to appoint his own deputy.

Koepp’s departure cleared the way for Painton to assume the deputy managing editor post, and in the ensuing transition months, she functioned as the acting deputy.

However, when Stengel officially took the reins, Painton turned out to be one of three deputy editors, sharing power with Adi Ignatius and Michael Elliott.

On the surface, the new triumvirate seemed to coexist in peace. But one Painton friend said that when she congratulated her on the new appointment, Painton just rolled her eyes in a dismissive fashion.

“She had been the executive editor with one other person prior to the announcement and now she was the deputy editor sharing the job with two other people,” said the former colleague. “At the time, she regarded it as a de motion.”

“Priscilla is wonderfully intense and a passionate, intellectual editorial leader,” said one source. “I think she thought she’d stick with it.”

One source said she even stopped rolling her eyes during editorial meetings with Stengel – something she was known to do whenever she disagreed with Kelly.

“I think she was trying hard to get with the program, but it’s hard to keep things totally repressed,” said one source.

Painton insisted that she was happy with the new lineup and had actually turned down other offers to stay put.

“Rick made a compelling case that he was going to reinvent the magazine and that I was going to be a big part of it,” Painton said.

She said she didn’t make any change in character.

“I’m famous for being very vocal at meetings, [and] I’ve continued to do that in my funny, cranky way if I think something isn’t smart enough,” she said.

But she insisted she never felt locked out of the inner circle.

“I’m two doors down from [Stengel] and he’s in my office five times a day.”

New lineup

Meanwhile, as Painton prepared to step down at the end of December, Stengel was putting the finishing touches on his new lineup at Time.

Assistant Managing Editor Romesh Ratnesar, who is in his early 30s, will move up the masthead and become the new deputy managing editor. Ratnesar, a former world editor and reporter in Iraq for Time, is currently in Germany on book leave, writing about the fall of the Berlin Wall.

Ratnesar will play a big role running the day-to-day operation of the print side when he returns.

Ignatius will remain a deputy managing editor in the new lineup, serving as a liaison with the magazine’s advertising team and overseeing certain writers.

Said Stengel of Ratnesar: “He’s incredibly able and competent and a great writer and editor. He can do everything.”

Ratnesar, who is seen as part of the magazine’s new, younger power lineup, will be coupled with Josh Tyrangiel, who last year was named the head of Time.com.

Elliott, who has been running the international editions from his perch as one of the three deputy managing editors, has moved up the editorial rung and will now be Time International editor, ranked just below Stengel on the masthead.

“It’s a recognition of how important the international titles are to the future of the Time brand,” said Stengel.

Caruso’s out

Michael Caruso has left the Condé Nast building for the second time.

Caruso, a one-time editor-in-chief at Details, was most recently listed as a contributing editor-at-large on the masthead of Condé Nast Portfolio. But even that has ended, as his six-month consulting contract will not be renewed.

He was hired by Editor-in-Chief Joanne Lipman to be a consultant and story doctor on some of the major feature stories.

Officially, the move is being spun as no great shakes. “He was only a consultant and he was never intended to be anything other than a temporary hire,” said a spokeswoman.

Caruso, who several months ago launched a Web site called Dailytube.com, could not be reached for com ment.

Still, some insiders are already grumbling that Caruso’s departure is another example of Lipman alienating magazine pros while staffing up with more alumni from The Wall Street Journal.

“She’s loaded the place with all these soft-section, Wall Street Journal people,” said one insider.

The number of ex-Journal people on staff is now close to a dozen – and growing.

And Lipman’s management style continues to be called into ques tion.

“She says she has an open-door policy, but what she doesn’t understand is that you have to listen to what people say when they’re inside the door,” said one source.

Whether it was coinci dence or not, Caruso’s con sulting gig comes to an end only days after Ed Felsenthal, most recently an assistant managing editor at the Journal, joins as a consultant.